Two opposing models have been proposed for AID to deaminate either DNA or RNA. Although most data supports DNA deamination, there is no physical evidence for uracils in immunoglobulin genes. Here we demonstrate their presence by determining the sensitivity of DNA to digestion with uracil DNA glycosylase and abasic endonuclease. Using several methods of detection, we identified uracils in the variable and switch regions. Uracils were generated within 24 hours after B cell stimulation, were found on both DNA strands, and were enriched in hotspot motifs. This data provides direct evidence for the model that AID functions by deaminating cytosine in DNA. We also found that variant AID/APOBEC proteins can all mutate the HIV virus, but only native AID protein efficiently causes class switch recombination of immunoglobulins. These differences are due to a 9-11 amino acid loop in the proteins that recognize different DNA motifs. Thus, AID has evolved to recognize a specific motif in switch regions, and APOBEC has evolved to deaminate cytosine in different motifs in retroviruses.